Datatec finalises $77,2m Brazil merger

May 7, 2008

Datatec subsidiary Logicalis Group has completed the $77,2-million merger of its Latin American operations with Promon Tecnologia, Brazil's largest Cisco partner.

The transaction was announced on 17 March and completed on 2 May.Under the terms of the deal, Datatec will allot 6 674 312 shares as part of the consideration, which will be listed on the London Stock Exchange and the JSE on Friday.Logicalis will have a 70% equity holding in the combined business.PT is the leading independent Brazilian network integrator and Cisco's largest partner in Brazil. It reported revenue of more than $140-million last year.As part of the transaction, assets of $11,6-million will be acquired, including about $15-million of cash.PT's customers include most of the major service providers and telcos operating in Brazil, and recently the business has started diversifying into other vertical markets including energy (oil and gas), financial, manufacturing and public sector markets. The transaction will provide Logicalis with a platform for further growth in Latin America and is in line with Datatec`s strategy of increasing the proportion of revenues and profits generated from developing countries and emerging markets.By combining PT in Brazil with Logicalis's operations in Argentine, Uruguay, Chile, Peru and Paraguay, the organisation will be the largest network integrator in the region, with about 500 employees.Datatec is an international company focusing on the supply of advanced ICT and the delivery of professional services into the higher growth segments of the global market. The group's main lines of business comprise the global distribution of advanced networking and convergence products through Westcon; IT infrastructure solutions and network integration via Logicalis; and strategic telecommunications consulting through Analysys Mason.